6. Producer surplus and price changes The following graph plots a supply curve (orange line) for a group of recent graduates looking to sell used air fryers. Each seller has only a single used air fryer available for sale. Think of each rectangular area beneath the supply curve as the "cost," or minimum price that each seller is willing to accept. Assume that anyone who has a cost that equals the market price is willing to sell their used air fryer. 240 200 PRICE (Dollars per used airfryer) 8 160 120 0 44 D Eric D 0 2,80 DO Ginny Kenji 0+ Lucia D + 0 Paolo 2 3 QUANTITY (Used airfryers) DO Sharon 0 ? Region X (the purple shaded area) represents total producer surplus when the market price is equal to S area) represents when the market price while Region Y (the grey shaded In the following table, indicate which statements are true or false based on the information provided on the previous graph. Statement True False O Assuming each seller receives a positive surplus, Eric will always receive more producer surplus than Ginny. Producer surplus is larger when the price is $140 than when it is $100. In order for Sharon to earn a producer surplus of exactly $40 from selling a used air fryer, the market price must be
6. Producer surplus and price changes The following graph plots a supply curve (orange line) for a group of recent graduates looking to sell used air fryers. Each seller has only a single used air fryer available for sale. Think of each rectangular area beneath the supply curve as the "cost," or minimum price that each seller is willing to accept. Assume that anyone who has a cost that equals the market price is willing to sell their used air fryer. 240 200 PRICE (Dollars per used airfryer) 8 160 120 0 44 D Eric D 0 2,80 DO Ginny Kenji 0+ Lucia D + 0 Paolo 2 3 QUANTITY (Used airfryers) DO Sharon 0 ? Region X (the purple shaded area) represents total producer surplus when the market price is equal to S area) represents when the market price while Region Y (the grey shaded In the following table, indicate which statements are true or false based on the information provided on the previous graph. Statement True False O Assuming each seller receives a positive surplus, Eric will always receive more producer surplus than Ginny. Producer surplus is larger when the price is $140 than when it is $100. In order for Sharon to earn a producer surplus of exactly $40 from selling a used air fryer, the market price must be
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:6. Producer surplus and price changes
The following graph plots a supply curve (orange line) for a group of recent graduates looking to sell used air fryers. Each seller has only a single used
air fryer available for sale. Think of each rectangular area beneath the supply curve as the "cost," or minimum price that each seller is willing to
accept. Assume that anyone who has a cost that equals the market price is willing to sell their used air fryer.
PRICE (Dollars per used airfryer)
240
200
160
120
80
40
0
U
0
Eric
0
D
1
2,80
Ginny
ロロ
Kenji
Lucia
0+
0
Paolo
2
3
4
QUANTITY (Used air fryers)
DO
Sharon
O
6
Region X (the purple shaded area) represents total producer surplus when the market price is equal to S
area) represents
when the market price
while Region Y (the grey shaded
In the following table, indicate which statements are true or false based on the information provided on the previous graph.
Statement
Assuming each seller receives a positive surplus, Eric will always receive more producer surplus than Ginny.
Producer surplus is larger when the price is $140 than when it is $100.
True False
In order for Sharon to earn a producer surplus of exactly $40 from selling a used air fryer, the market price must be S
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